An aerial view of Samsung Electronics’ semiconductor production facility in Xian, China.

Samsung Electronics’ Xi’an plant in China, which is the main production base of 3D NAND flash memory chips, has achieved the initial wafer production target of 100,000 sheets a month based on its stable market demands. This is the maximum figure possible with the current production facility. The company, which has ordered 3D NAND manufacturing equipment this year, will make an additional investment in the 3D NAND production line from next year.

According to industry sources on Dec. 20, the wafer production of Samsung Electronics’ Xi’an plant in China has reached 100,000 sheets on a monthly basis a year and a half after starting a full operation. Its monthly production stood at 10,000 to 20,000 sheets last year and passed the 50,000 mark in the third quarter of this year.

The latest figure has far surpassed its previous forecasts of 60,000 to 70,000 sheets. It means that the demand of 3D NAND flash products is growing greater than expected. In fact, Samsung Electronics has recently been using 3D NAND products in microSD cards as well as servers and solid state drives (SSDs) for consumers, expanding its application areas. The company is also planning to use them in mobile devices, including smartphones, in earnest from next year.

Samsung Electronics has become the world’s first company to mass produce 3D NAND flash chips in May last year, and has been producing its second-generation chip with 32 layers and the current third-generation product with 48 layers. Its competitors Toshiba Corp., Micron Technology and SK Hynix Inc. are also entering the 3D NAND market, following Samsung.

Industry watchers expect that Samsung Electronics will put in extra investment in the Xi’an plant from next year in earnest. However, it is still unclear how much Samsung will inject into Phase 2 investment after spending US$2.3 billion (2.7 trillion won) in Phase 1 investment. Currently, only 231,000 out of the 1,124,000 square meters of the Xi’an plant site is being used, and a total of three more production lines with a monthly wafer production capacity of 300,000 sheets can be established here.

On the other hand, some say that Samsung Electronics is unlikely to rapidly increase its output considering the current memory market conditions. Since the price of memory products in major markets, such as personal computers, mobile devices and servers, is continuously decreasing, the company is expected to watch the market conditions first until the first quarter of next year. An industry official said, “Currently, Samsung Electronics is far ahead of competitors in the 3D NAND market, but it will carefully make a decision, considering the current situation that Intel, Toshiba and SK Hynix are recently making investments.